It's widely believed in Arabic culture, and in Egypt particularly, that Hasad (envy) leads to the loss of the thing you were envied for.Hasad حسد is usually translated as 'envy' but it means to envy others for something they have, for example a happy family, a house, a new car .. etc and wish that they lose it.

People took this seriously in the past. For example if I just bought a new car and the next day I made an accident with it, people would believe it happened because someone envied me for my new car.

So the sentence means something like :May we stay protected from the evil eyes of those who envyMay the one who envies us have a stick penetrate his eyes by which he envies. :P الحسود is the one who envies.

so evil as you can see. I wouldn't wish that to happen even for someone who envies me :DBut as a phrase gets repeated over and over, people forget its meaning.Nowadays, people don't take this too seriously.